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Spreads on CMBS are blowing out again as the commercial real estate market follows residential into the housing decline.

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Moody’s is piling on today with another downgrade of CMBS.  The timing of these analysts is impeccable.  Although the banks continue to rally on the idea that nationalization is not in the Obama game plan I believe their balance sheets are likely deteriorating just as rapidly as ever.  The commerical real estate implosion is only just beginning.  Combine the already rapid declines in residential and the declining credit card delinquencies and you have a perfect axis of evil.  The bank balance sheets are a disaster.  I can’t think of a single good reason to be involved in the sector.